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Wednesday, August 30    |    Upstate South Carolina News, Sports and Information

Medicaid crooks face high-tech foe
Computer program to help find false health claims, which cost state millions

Published: Wednesday, August 9, 2006 - 6:00 am


By Liv Osby
HEALTH WRITER
losby@greenvillenews.com

A doctor who sees 50 patients daily in his office, psychiatrists working more than 24 hours a day, and ambulance rides with no destination.

Fraudulent Medicaid claims like these cost South Carolina millions of dollars every year, according to the state Department of Health and Human Services.

But now the state has a new tool to help it catch Medicaid crooks -- computer technology that can recognize billing abnormalities.

About 1 million South Carolinians are enrolled in the $5 billion Medicaid program for the poor, which uses $1.5 million in state funds.

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And even though the state recovered more than $17 million in phony claims last year, with 46 million claims submitted annually by 30,000 health-care providers, fraudulent bills, as well as unintentional billing errors, are bound to slip by undetected, HHS spokesman Jeff Stensland said Tuesday.

But with the new system, provided under a five-year, $9.6 million contract with Thomson Medstat, the state expects to save another $2 million to $8 million a year, he said.

Already, a dry run uncovered $167,517 in ambulance service claims with no corresponding hospital or doctor claim, $670,000 in charges from five psychiatrists who would have had to have worked more than 24 hours a day to justify their bills, and Medicaid beneficiaries going doctor shopping in order to obtain drugs, Stensland said.

After further investigation, those cases could be referred to state Attorney General Henry McMaster for prosecution, he said.

Last week, McMaster filed a $40 million lawsuit against five major drug companies, alleging that they inflated prices for drugs covered by Medicaid and state health plans. A similar suit in Texas recovered $55 million so far, he said.

"Medicaid fraud is a serious matter," HHS Director Robert M. Kerr said in a release. "Our investment in the Medstat system will help us maintain program integrity, operate more efficiently and protect the taxpayers."

Kathleen Snider, head of the department's Bureau of Compliance and Performance Review, said the new system puts South Carolina at the cutting edge of fraud detection technology.

"It will shine a light on questionable practices and ultimately rein in wasteful spending," she said.

Stensland said the Medstat system also will be used to ensure that best practices are followed and to help make policy decisions.

The federal government is picking up 90 percent of the cost the first year and 70 percent a year thereafter, Stensland said.

Michigan-based Thomson Corp. provides technology services to Medicaid programs in a number of other states, according to the department.


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